ChrysCapital, True North Managers and others invest $150 mn in QuEST Global

Product engineering and lifecycle services company QuEST Global, announced that global investors - ChrysCapital, True North Managers LLP, and other institutional investors – have invested $150 million for a minority stake in the company. 

The investors have brought a portion of the shares held by the co-founders and management team of QuEST. The existing investors - Bain Capital, Advent, and GIC, continue to remain invested. O3 Capital acted as the sole financial advisor to the transaction.

This transaction values the company at $1.8 billion. QuEST Global had revenue of $600 million for FY21, compared to $700 million in FY20. The company has presence in 13 countries with 54 global delivery centers. Its total employee headcount is over 11,250.

Ajit Prabhu, Chairman & CEO, QuEST Global, said, “The investment by three of the most respected global investors, despite the ongoing pandemic crisis, is a testament to our ability to build and grow our business to become the most trusted thinking partner to customers. It also crystallizes the value we have created for our shareholders and employees who have placed their belief in us and partnered with us in this journey.”

Lately, the product engineering space has seen a lot of M&A activity in India as well as globally. With the pandemic accelerating digital transformation across industries, enterprises are investing heavily in digital solutions to lead and take advantage of this wave of software product engineering. The Indian engineering and research and development is a $31 billion industry.

Recently GlobalLogic was acquired by Hitachi for $9.6 billion. In 2020 Capgemini had acquired Altran Technologies for $4billion. Some of the prominent players in India in the pure-play engineering R&D area Cyient and Persistent Systems.

“QuEST is one of the top five players in the pure-play ER&D space and has built unique and deep expertise in an industry that is undergoing unprecedented digital disruption. We believe the ER&D space will continue to see significant growth and innovation in the years ahead, and we look forward to working with QuEST’s management team to capture these opportunities,” said Prasad Thrikutam – Partner, True North.

The company will be focused on developing capabilities in hi-tech, software, digital segments along with other industries and help our customers solve their engineering challenges.

Sudip Nandy, Sr. Advisor. Enhancin, ChrysCapital, said, “QuEST is one of the leading players in the engineering services space and has consistently outperformed its peers and demonstrated the ability to scale accounts in a fragmented industry, by becoming the core engineering partner to most of the top global firms across its target industry verticals. We are excited to back Ajit and the executive team at QuEST and look forward to working with them on the journey ahead.”

• Product engineering & R&D space

• Japan-based Hitachi acquired GlobalLogic for $9.6bn in March 2021

• Capgemini acquired Altran Technologies for $4.1bn in 2020

• Global R&D spends are expected to be $1.5trillion; outsourced R&D is about 5% of this